Despite the possibility of a ban in the United States due to national security concerns, advertisers are committed to continuing their investment in TikTok. The short-form video app, owned by Chinese tech firm ByteDance, has already been banned from government-issued phones in multiple countries. However, TikTok’s ad business is projected to grow by 36 percent this year to $6.83 billion, according to research firm Insider Intelligence.
Ryan Detert, the CEO of Influential, an influencer marketing company, has stated that none of his clients have expressed any concerns over investing in TikTok. Detert has worked with brands such as Pepsi and the NFL. Two media buyers from major ad agencies have also confirmed that Washington’s scrutiny over the app has not impacted their clients’ plans on TikTok.
TikTok Announces New Ad Format
On Thursday evening in New York, TikTok unveiled a new ad format that will allow brands to place ads next to content from publishers such as BuzzFeed, Dotdash Meredith, and NBCUniversal. The new format will give publishers a 50 percent cut of the ad revenue. Despite the concerns over TikTok’s Chinese ownership, the app remains highly popular with users, making it an essential platform for advertisers.
Mark DiMassimo, founder of creative agency DiMassimo Goldstein, has stated that TikTok is irreplaceable for advertisers unless they are forced to replace it. The threat of a U.S. ban, however, remains an “elephant in the room,” according to several media buyers.
Stephani Estes, the chief media officer at digital marketing agency Goodway Group, has acknowledged that there is a lot of uncertainty surrounding TikTok due to the possibility of a U.S. ban and the current economic situation. Despite this, TikTok has stated that it is addressing advertiser concerns “head on in an open, fact-based and ongoing dialogue.”